Slope of Hope Blog Posts

Slope initially began as a blog, so this is where most of the website’s content resides. Here we have tens of thousands of posts dating back over a decade. These are listed in reverse chronological order. Click on any category icon below to see posts tagged with that particular subject, or click on a word in the category cloud on the right side of the screen for more specific choices.

Let’s Wrap This Up

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The past six trading days have been absolutely bonkers. Starting a week ago, I started to get freaked out that we were going to go into some kind of counter-trend rally. God knows, everyone has been predicting it. And this morning’s no different. My Twitter feed is slathered with “we’re going to 4,400′ type predictions. Such predictions have cost me staggering sums of foregone profits recently.

Of course, the bears have absolutely owned this market for 2022, and this week in particular. For all the dramatic hoo-ha about the $3.2 trillion OpEx, equity futures are picking their noses with about 1% price gains pre-market.

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Through A Glass Darkly

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SPX broke down and has retested the retracement low, as have NDX and Dow as well, but not yet IWM. This brings SPX and the other US indices to the key inflection point this year, where we see whether the move so far this year has been the formation of large bull flags setting up retests of the all time highs, or whether US indices are going to break down further directly.

What we have on the bull side here are possible buy signals now brewing on the weekly chart and clear high quality bull flags formed on SPX and Dow particularly, as well as on many other individual stocks and ETFs of course. On the bear side we have the worsening economy, rising interest rates and embedded inflation that the Fed are now admitting is not transitory. I would point out though that a retest of the all time highs might well not be a bullish development, as that might make the second highs on double tops large enough to then potentially retrace most or even all of the gains made since the 2020 low.

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Testing The Middle Band

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Yesterday’s bearish historical stats delivered hard and broke the bull flag setups that I posted in the morning. SPX is now testing the 4000 area and, if that breaks, the next target will likely be a retest of the retracement low at 3810.32.

I still like all the bull flags from the high here, but if SPX reaches the retracement low and continues down hard, there is an obvious target for that move. The H&S I have drawn on SPX from the high isn’t high quality, but it isn’t bad, and has a very obvious target in the 3400 area, which is a significant area because that would be a backtest of the pre-2000 crash all time high. In my view that would be the obvious target on a  break below 3600.

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